scholarly journals Firm valuation: An application on Borsa Istanbul with discounted cash flow and relative valuation approaches

2021 ◽  
Vol 7 (3) ◽  
Author(s):  
AYSE GENC ◽  
HAKAN SARITAS
Keyword(s):  
Cash Flow ◽  
Firm Valuation ◽  
Discounted Cash Flow ◽  
Relative Valuation

scholarly journals Stock Valuation in Pharmaceutical Sub-Sector Companies using the Discounted Cash Flow and Relative Valuation Methods in the 2013-2020 Period

2021 ◽  
pp. 167-176
Author(s):  
Afna Dalilah ◽  
Riko Hendrawan
Keyword(s):  
Cash Flow ◽  
Stock Exchange ◽  
Fair Value ◽  
Free Cash Flow ◽  
Discounted Cash Flow ◽  
Stock Valuation ◽  
Industry Growth ◽  
Valuation Method ◽  
Pessimistic Scenario ◽  
Relative Valuation

This research aims at calculating the fair value of shares of pharmaceutical companies listed on the Indonesia Stock Exchange (IDX). The data used in this research is historical data from the 2013-2020 financial statements, which are used as the basis for projections in 2021-2025. The method used in this research is Discounted Cash Flow (DCF) method with Free Cash Flow to the Firm (FCFF) approach and Relative Valuation method with Price to Earning Ratio (PER) and Price to Book Value (PBV) approaches in three scenarios. The three scenarios used are the optimistic scenario (condition above industry growth), the moderate scenario (the most likely condition for the company), and the pessimistic scenario (the average condition of the industry). The results of the research showed that by using the DCF-FCFF method, KAEF and PYFA stocks experienced overvalued conditions in all scenarios. Meanwhile, KLBF and DVLA stocks were undervalued in all scenarios. Then, from the calculation of the Relative Valuation method, each company was still within the industry range in all scenarios. Overall, KAEF stocks were overvalued by 57.817%, KLBF stocks were undervalued by 7.879%, DVLA stocks were undervalued by 370.865%, and PYFA stocks were overvalued by 16.662% both in DCF method and in Relative Valuation method.

scholarly journals FIRM VALUATION CONCEPT AND DISCOUNTED CASH FLOW METHOD: A COMPARISON OF STOCK MARKETS

10.26458/1922 ◽  
2019 ◽  
Vol 19 (2) ◽  
pp. 51-60
Author(s):  
Esref Savaş BASCI
Keyword(s):  
Cash Flow ◽  
Capital Markets ◽  
Firm Value ◽  
Market Value ◽  
Firm Valuation ◽  
Share Price ◽  
Current Status ◽  
Discounted Cash Flow ◽  
Future Expectations ◽  
Market Values

Company (or firm) valuation – an evaluation process of a company to appreciate the value of a company’s right in this company or business. There are two objective and subjective aspects of value. The subjective value is the value determined by individuals and desires. For example, it is a subjective decision that the investor assesses the competitor over the normal to be monopoly in the market. The objective value is the value determined by the cost and benefits of the goods and services.Although there are many performance measures that measure company success, none is as comprehensive as value. There is a strong and linear relationship between a company’s market value and its discounted cash flows. Because earnings are used to generate the income statement, they cannot be used to measure cash flows.Firm valuation means seeking the goal of the firm which is listing it on the Stock Exchange. Real value of the firm can be calculate with different methodologies. These methods are related to future expectations or background of the firm’s financial data. Discounted Cash Flow (DCF) Method is one of the firm valuation methods used all around the world and it is accepted by the experts.Market value is also used for comparison and performance measurement purposes. Valuation of a company’s future expectations, current status, mergers or acquisitions is extremely important. Even the firm value can be used to compare the capital markets of countries. In our study, capital markets and total market values of selected countries are compared. The increase in the share price increases the market value of the company. Therefore, the aim of the firms should be to increase the shareholder value or to take decisions to increase the stock price.   

scholarly journals Analysis of Islamic Banks’ Merger in Indonesia

2021 ◽  
Vol 4 (2) ◽  
pp. 112-120
Author(s):  
Fitri Mareta ◽  
Heliani Heliani ◽  
Siti Elisah ◽  
Andini Ulhaq ◽  
Indri Febriani
Keyword(s):  
Market Share ◽  
Cash Flow ◽  
Islamic Law ◽  
Stock Exchange ◽  
Profit Sharing ◽  
Free Cash Flow ◽  
Islamic Banks ◽  
Discounted Cash Flow ◽  
The Public ◽  
Relative Valuation

Islamic bank is a bank that collects funds from the public by using system profit sharing for every profit it gets and in carrying out its activities in accordance with Islamic law. Remembering that in Indonesia most of the population is Muslim, therefore they need a bank that works in accordance with Islamic law. Considering the number of percentages of Islamic banks in Indonesia are still small and cannot yet dominate the market share, therefore this research is expected to find out whether the merging of 3 Islamic banks (BRIS, BSM and BNIS) able to control market share or not. To see the synergy resulting from this merger is used methods Discounted Cash Flow - Free Cash Flow to Equity and Relative Valuation - Price to Book Ratio. The data used are the financial statements of each bank from 2014 to 2019 which are available on the Indonesia Stock Exchange (IDX) or the websites of each bank.

scholarly journals Advantages and limitations of the discounted cash flow to firm valuation

Skola biznisa ◽  
2013 ◽  
pp. 38-47 ◽  
Author(s):  
Sanja Vlaovic-Begovic ◽  
Mirela Momcilovic ◽  
Slobodanka Jovin
Keyword(s):  
Cash Flow ◽  
Firm Valuation ◽  
Discounted Cash Flow

scholarly journals Stock Valuation using Discounted Cash Flow Method with Free Cash Flow to Equity and Relative Valuation Approaches on State-Owned Banks Listed on IDX for 2021 to 2025 Period Projection

2021 ◽  
pp. 191-201
Author(s):  
Almirah Jumran ◽  
Riko Hendrawan
Keyword(s):  
Cash Flow ◽  
Stock Prices ◽  
Intrinsic Value ◽  
Free Cash Flow ◽  
Regulatory Capital ◽  
Discounted Cash Flow ◽  
Industry Growth ◽  
Valuation Method ◽  
Price Earnings Ratio ◽  
Relative Valuation

This study aims to project the intrinsic value of state-owned banks listed on IDX for the 2021 to 2025 projection. This study uses the Discounted Cash Flow (DCF) method with the Free Cash Flow to Equity (FCFE) approach specifically for banks by looking at the regulatory capital. Meanwhile, it is also used the Relative Valuation method with the Price to Book Value (PBV) and Price Earnings Ratio (PER) approaches. This study uses three scenarios will be used, which consist of a pessimistic scenario (the average condition of the industry), a moderate scenario (the same condition as the company's growth), and an optimistic scenario (a condition above industry growth), which aims to project the stock value over the next five years. The data used in this study comes from historical data during the 2016 to 2020 period. Based on the results, the stock prices of state-owned banks using the FCFE method shows undervalued results for all scenarios. Meanwhile, using the relative valuation method, PBV in the optimistic scenario only shows BBNI undervalued conditions. In addition, in moderate and pessimistic scenarios, only BBRI shows overvalued conditions. Furthermore, PER shows undervalued results for all scenarios.

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